Kraken-linked SPAC searches for acquisition target worth up to $10 billion

KRAKacquisition Corp., a special purpose acquisition company backed by crypto exchange Kraken, is searching for a potential acquisition target valued at up to $10 billion, according to director Ravi Tanuku.

The SPAC, formed in January, raised $345 million through an initial public offering, starting a two-year window to identify a private company for a reverse merger that would take it public.

Tanuku said the firm has not yet determined what the target company will look like, but it is likely to focus on businesses connected to crypto, stablecoins, DeFi, or payment infrastructure. He noted that Wall Street’s interest in companies tied to stablecoins and tokenization has surged over the past year.

While the $10 billion figure is only an approximation, Tanuku said the eventual target could also fall closer to a $2 billion valuation. The wide range reflects KRAKacquisition’s broad interest in helping small- and mid-cap companies access public markets.

He added that taking smaller-cap companies public has become increasingly difficult, making SPACs an alternative pathway for firms operating in the digital asset sector.

Tanuku described KRAKacquisition as a strategic investment vehicle for Kraken, potentially allowing the exchange to align economically with another company through a meaningful equity stake. Kraken’s willingness to lend its brand to the SPAC also signals its commitment to the initiative.

The search comes as Kraken itself is considering an initial public offering this year. The exchange previously confidentially filed a registration statement with the U.S. Securities and Exchange Commission and completed an $800 million fundraising round that valued the company at around $20 billion.

In its registration filing, KRAKacquisition also argued that the long-term decline in the purchasing power of the U.S. dollar has strengthened the case for “hard assets” such as Bitcoin as inflation hedges.